Re-Launching SAP Business ByDesign
The Original Launch
SAP Business ByDesign was formally launched on September 19, 2007 (see press release). At that time the pricing was $149/user with a 25 user minimum ($3,725/month). It’s reported by Michael Krigsman in Enterprise Irregulars that 100 customers were enrolled (50 implemented) on this offering prior to the redesign.
3 Years Later
As reported from the SAP SAPPHIRE conference by Doug Henschen in Information Week, SAP’s on-demand offering will launch in late July 2010.
This information was also reported by Thomas Wailgum in his CIO article SAP’s Business ByDesign: Finally Real, But a Tough Sell? Quoting co-CEO Jim Hagemann Snabe “Business By Design is not a fantasy. It’s a real product. We wanted to perfect the infrastructure. You only get one chance.” Ironically, this is SAP’s second attempt at a successful SaaS offering.
Features, features, features
So what is going to be different this time around? According to several sources, Business ByDesign is relaunching with new infrastructure technology and new features.
Tim Ferguson in Silicon.com article SAP: Business ByDesign is coming this year, mentions that new features such as in-memory analytics, support for specific mobile device scenarios, and Silverlight web development were announced at SAPPHIRE.
Dennis Howlett in his ZDnet Blog posts a video of Hasso Plattner describing SAP’s challenges in launching an on-demand offering. He describes technology challenges as well as the challenge of replicating every feature available in SAP’s traditional products in ByDesign.
Howlett’s video highlights the feature battle faced by SAP. The SAP sales teams are used to selling a solution that includes every possible feature. SAP customers will line up feature comparisons and demand that all features are supported in Business ByDesign. The sales process will be different and sales teams will have to evolve.
Vendors which pioneered on-demand services such as NetSuite, Intacct, and Acumatica were able to design a solution which was unencumbered by existing feature requirements, pricing models, and customer demands. The sales processes at these companies are designed to overcome hurdles such as a missing feature.
SaaS ERP is a reality
In our opinion, there will always be a variety of deployment models to meet different ERP customer needs. But most vendors are developing a SaaS solution or hosting their legacy on-premise application and spinning it as SaaS.
SaaS ERP is a reality, the question is, what percentage of ERP will be sold this way, both in the market and at SAP?